“Wealth gotten by vanity shall be diminished…” -Proverbs 13:11
Nobody warned of covetousness more than Jesus did. He said in Mark 12:15:
“Take heed, and beware of covetousness: for a man’s life consisteth not in the abundance of the things which he possesseth.”
In Matthew 16:26, He said, “For what is a man profited, if he shall gain the whole world, and lose his own soul? or what shall a man give in exchange for his soul?”
How about Mark 10:25? “It is easier for a camel to go through the eye of a needle, than for a rich man to enter into the kingdom of God.”
How could it be otherwise when the Father’s law, which is written within the hearts of His children, had already told us “Thou shalt not covet”? (Exodus 20:17; Isaiah 42:21; Psalm 40:7; Hebrews 8:10, 10:7; Romans 3:31)
In America, we used to follow that law, which was upheld until 1964 when the first lottery took place in New Hampshire, which kept us free from the very abuses that we are seeing today.
When it comes to those who are promoting and gaining from this illegal activity, I ask, who do you think it is that profits from the lottery the most? The winner or the government, both federal and state?
I recently dove into finding out and here were the results that I had discovered.
Mega Millions and other lotteries generally allow a winner to decide how they want to take possession of the jackpot – either by choosing an annuity where the jackpot is paid out over a 30-year period or by taking it in one lump sum. According to lottery officials, most winners opt for the lump sum, or “cash option,” as Mega Millions calls the payout.
In the case of the next Mega Millions jackpot of $1.28 billion, that amount would be $747.2 million. It’s a staggering pile of money, but it’s not exactly what you would pocket following your win.
The federal government and all but a few state governments will immediately have their hands out for a bit of your prize.
The top federal tax rate is 37% for income over $500,000. The first thing that happens when you turn in that winning ticket is that the federal government takes 24% of the winnings off the top.
But the payments don’t end there. You will owe the rest of the tax — the difference between 24% and 37% — at tax time next year.
So, let’s say you decide to take the cash option when you win the Mega Millions jackpot. If the jackpot remains at $1.28 billion for the next drawing, the cash option is $747.2 million.
The federal government will immediately take $179,328,000 from that cash option (24%), leaving you $567,872,000. Remember, the rest of your federal tax bill comes next year and will cost you another $97,098,955.
So, when you take the cash option, you will end up with $470,773,045 after federal taxes.
Now it is the state’s turn.
State tax rates on lottery winnings vary. If you live in North Dakota, your state tax rate for lottery winnings is 2.9%. That means if you take the cash option and the federal and state government both get their shares, you are left with $449,104,245.
If you live in New York, get out your wallet, because that state taxes lottery winnings at 8.82%. The lump sum most New York residents would get after federal and state taxes would be $389,328,245. Additional taxes are charged if you live in New York City or Yonkers.
If you live in California, Delaware, Florida, New Hampshire, South Dakota, Tennessee, Texas, Washington or Wyoming there’s some good news for you — those states do not tax lottery winnings. This means if you live in those states and win, you will get $470,773,045.
No wonder why the government has a hand in the promoting the lottery. They profit from it the most.
Lose the money, friends, and gain your soul.
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